Las Vegas Little Black Book Blog
The Future of Laughlin 
10/17/06, 10:18 PM
Usually the sale of two casinos in Laughlin does not cause a blip on my radar screen. But coupled with some other news out there, it makes me ponder, what is the future of Laughlin?

Of the nine casino resorts in Laughlin, five have been sold recently, all at good prices.

Recent Purchases
- Tony Marnell's group purchased the Colorado Bell and the Edgewater from MGM Mirage.
- Columbia Sussex purchased the River Palms
- Landry's Restaurants bought the Golden Nugget Laughlin
- American Real Estate Partners purchased the Flamingo Laughlin

That leaves...are they next?
- Harrah's Laughlin
- Ramada Express
- Pioneer
- Riverside

Why the purchases?

Laughlin has been falling year after year in visitors. From a recent LVRJ Article on Oct 13th....

"Visitor volume fell in Laughlin during August with 275,608 visitors coming to the Colorado River community, an 18.1 percent drop compared to 336,679 a year ago".

18%? Both the power of the Las Vegas destination and the growth of Native American casinos have brought rough times to Laughlin resorts.

It's not about visitors

Then it hit me with an news story today about the 300,000,000 US resident. The local news followed up with a segment about the Nevada population growth. Currently at 2.5 million, it will grow to 3.5 million in the next twenty years, most of it in Southern Nevada.

With Las Vegas already going through growth pains, the valley's land is constricted by the mountains. That means more people will move to the surrounding towns of Mesquite, Pahrump, Prim, and of course Laughlin.

Laughlin should be considered part of Arizona

But Laughlin is unique, because it is actually one part of a dual city. Directly across the Colorado River is Bullhead City, Arizona. Everything from Kingman, Arizona to Bullhead, City is booming. Del Webb and others are building huge developments in the area. Land speculators believe that the new Hoover Dam Bypass will cause more commerce for the area.

So Laughlin casinos will be "local" casinos? Yes.

Expect more focus on the local residents, rather than the visitors, as Laughlin grows. Local gamblers are very profitable, especially the retirees (which will make up the entire Del Webb community) with the free time and the disposable income. Locals will be the gaming driver of the Laughlin Resorts.
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The Future of Las Vegas 
10/16/06, 1:27 AM
An interesting article in the LVRJ about the next wave of resorts in Las Vegas.

Here is a round up from the article....

"A transformational project for Las Vegas."

"A quality developer with experience in this marketplace. Looking forward to seeing (former Mandalay Resort Group President) Glenn (Schaeffer) again."

"Many investors underestimate the brilliance and execution capability of Boyd Gaming. Management talent will get the job done, and the city needs a midmarket project of this magnitude."

"Highly speculative as currently planned given the site configuration."

"Executive turnover in previous months suggests there may be some difficulties, but the project is likely to move forward."

"There needs to be a little more time for that part of the valley to comfortably absorb this supply."

"This will be a success for both Trump and Las Vegas."

"The timing is uncertain. Will Trump enter the picture at some point?"

"Las Vegas Sands needs this additional room capacity. It's clearly moving as planned; sufficient capital and a great location."

"The Encore is an important second tower for Wynn Resorts that will enable the company to leverage its cost structure."

"A solid residential location."

"While we believe the W project is experiencing delays, we do believe that it will ultimately be built, unlike other notable projects."

"A great location."

"Harrah's (Entertainment) has the ability to successfully integrate its Strip properties and it will represent a powerful alternative for consumers."

Click Here for the Full Story from the LVRJ
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The irony of taking Harrahs private: To go IPO 
10/10/06, 6:58 AM
Good article in the Las Vegas Business Press about Harrahs and the buyout offer.

The ultimate goal of the private offer to buyout Harrahs: to go IPO in a couple of years after the company is higher valued. The article explains a couple of ways to get there.

Click Here for the Story from the LV Business Press
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Expect the Playboy Club to be tough to get into 
10/8/06, 3:09 AM
The long awaited Playboy Club opens today on the top of the Palm's new Fantasy Tower. The Playboy club is a mix between an ultralounge and a small casino. It will be "more intimate, more exclusive" than the traditional night time venue. It will prove to be very successful and it is a great addition to Las Vegas.

But for a group of guys, the Playboy Club will be as hard to get into as a top nightclub. Expect to fight your way to the front of the line and expect to have to tip the door man to get in.

Give it a couple of months, and try to hit it midweek for your best chance of making through the door. Also, be sure to dress to impress. An easier way to make it in is to dine at Nove, the new italian resturant, and then head to the club from there.

Click Here for the Article from the LVRJ

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What is the real reason that Harrahs pulled out of Singapore? 
10/7/06, 2:58 AM
Harrah's accounced today that it is pulling out their bid for Singapore. Las Vegas Sands (Venetian) won the first casino project, Harrah's and four other lesser know companies were up the second bid. All design concepts were to be submitted by October 10.

According to the Taipei Times, all bids must be "feng shui", irregular or sharp angles should be avoided, and a round, semi-circle or an ellipse design will probably win the 2nd casino bid.

The Las Vegas Sands is planning on building a $3.2 billion dollar complex. A design with three slanting hotel towers overlooking three low-rise waterfront domes and roofs resembling waves.

The Taipei Times also stated that a pavilion or memorial, from WWII regarding a massacre from the Japanese occuption, should be erected, or a multi-religious service held, before construction starts to avert accidents, suicides or a loss-making venture.

As you can see, the culture in Singapore is much much different than what American companies are used to. With the scope of this project and the different culture, was Harrah's in over their heads?

Consider This
Could it be possible that Harrah's knew that their design concept was not going to win? Maybe the takeover bid was just an excuse to pull out while saving face. If they lost the bid straight out, it would be a huge blow to any thoughts of big international developments. No casinos in the two huge markets of Macau and Signapore?

If the submittal was Oct 10, then the bid already had to be completed. Why not just submit the bid? If you do win it a couple months down the road and you can't move forward, then pull out. It is not like Harrah's needs to appease the Signapore government, this is a one shot deal.

To me, using the takeover bid as a excuse is an easy way out.

Click Here for more about the Singapore pullout from the AP

If Harrah's dosn't take the buyout offer, what will it do?

Geoffrey Davis, an analyst with Citigroup, said in a Monday client note that if Harrah's doesn't take a buyout, it could make an attempt to reduce capex and repurchase its stock as a public company. In a scenario of debt-to-EBITDA of 5.5 times, the company could buy back 60 million to 65 million shares, raising its 2008 earnings per share estimate to $5.13 from $4.74.

Click Here for the Story from the AP
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Crazy Horse will probably open again soon 
10/6/06, 5:17 AM
But will it be too late?

As each day goes by, the club loses its brand as customers, who don't know its closed, go there and find a dark building. Taxi driver are talking down the club, using it as another reason to sway people to Sheri's Caberet or Diamonds. (If you are new to this blog, don't ever go to Sheri's or Diamonds, better yet, don't ever listen to the advice of a Vegas taxi driver).

But more importantly, Crazy Horse Too is a club that has a large group of "regular" dancers. Year after year, the same girls work there and many customers keep going back to revisit their favorite ones. But as each day goes by, these dancers are getting more comfortable working at other clubs.

So, if the Horse re-opens, how many of the regular girls are going to make there way back? There are two new clubs opening in the upcoming weeks: Minxx and The Men's Club. If Crazy Horse does not open in a month, their best dancers will be working elsewhere.

Click Here for an update on the Crazy Horse drama (from the LVRJ)
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Scores Las Vegas: Now 24 Hours 
10/5/06, 7:22 AM
The #1 gentlemen's club since it open last year. The club is now open 24 hours a day.

What does this mean for you? It means an excellent place to watch college and pro football games on Saturday and Sunday. The sportsbooks gets filled quickly. Most of them have less than adequate tvs. Scores has tons of plasmas and three large digital projection screens. They show all the games.
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Blue Horseshoe Loves Harrahs Entertainment 
10/4/06, 7:01 AM
Quoting one of the best "guy's" movies of all time, "Wall Street". In other words, Harrah's Entertainment is in play. Expect a bidding war to unfold in the near future.

At least that is the speculation from Reuters and industry analysts. With a valuation at $85 to $90 per share, it is expected to see additional private offers.

According to the article, it is going to take a good 12 to 16 months for any deal to go through. With all the regulatory hurdles in so many different jurisdictions, it may take longer.

Harrah's is already reviewing its Singapore Project - it may pull out now. I would also say that there will be no closing (and implosions) of any casinos until the deal is finalized. So, that means that you can enjoy the Imperial Palace and the Barbary Coast for at least another year.

Click Here for the Story from Reuters
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Barbary Coast: How Long Until Its Gone 
10/3/06, 7:40 PM
The deal for the Barbary Coast is so over due. For how long has everyone talked about the value of the Barbary Coast land and how much it means to Harrah's (or Caesar's, or Park Place, or Hilton or whoever used to own the Flamingo).

Looking at the land that Boyd will aquire from Harrah's, it makes you think...why didn't Boyd make a play for the land before Harrah's snatching it up?

Back to the Barbary. Every expects Harrah's to blow it up to build Harrahs America. I think it will be around longer than anyone thinks. But, it will eventually come down.

What I will miss about The Barbary Coast:
- The low table minimums
- No automatic shufflers
- Big Elvis
- The somewhat secret parking garage
- The view from the top of the building
- The ease of getting in and out of the casino
- The $1 You Call It Drink Specials
- The Flashing Neon Sign

What I won't miss about the Barbart Coast:
- The smoke
- The dirt
- The small dirty glasses used to serve drinks
- The overhype of Drai's afterhours
- The line to get a seat at the coffee shop
- The old lady with an oxygen tank smoking a cigarette (fire and oxygen don't mix very well, kaboom)

Click Here for the Story from the LVRJ

In related news, the $81 per share offer of Harrahs is considered too low, according to industry analysts. $85 per share is more likely.

Click Here for the Full Story About the Harrah's Buyout from the LVRJ
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Harrahs Buyout Offer 
10/3/06, 5:42 AM
For those of you that loves casinos, here is the latest story about today's private buyout of Harrahs. It will take a little while to figure out how this is going to change the gaming industry, but it will be instrumental.

Also, Harrah's made a land swap for the Barbary Coast Casino.

Click here for the Story from the LVRJ

There is speculation on Wall Street that the shareholders won't go through with the bid. Interesting view point from the Motley Fool.

Click Here for the Story from the Motley Fool
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